London pre-open: Quiet start for FTSE

LONDON (ShareCast) – City sources predict the FTSE 100 will open nine points below Friday’s close of 6,829.30, beginning the week on a quiet note as US markets close for Martin Luther King Day and with little due out in the way of European data and results.

Over in Asia markets were broadly lower after data released from China overnight showing a decline in growth, while retail sales met expectations but fixed asset investments (FIA) missed.

Market Analyst Craig Erlam from Alpari said: “With such a large amount of data being released, I guess the real question investors have to ask themselves is which do they consider most important. The obvious answer would be the GDP figure as it gives an overview of how the economy has performed in the last quarter and the year as a whole. However, this can be misleading as it doesn’t highlight where the growth is coming from and whether it is sustainable.

“The FIA number has been of key interest for many years, especially since 2008 when the government underwent a huge stimulus plan in order to counter the negative impact of the global recession. But with them now looking at a more targeted stimulus plan and wanting to move to a growth model driven by the consumer, maybe it’s time to put less emphasis on this and more on the retail sales figure.”

In other news, over the weekend the Cruise Lines International Association (CLIA) released figures which showed a more than 5% annual rise in cruises in 2013, and a more than 21% increase over the past five years. The forecast figures showed that last year the number of cruise passengers from across the globe is forecast to be 21.3m, with that number set to rise to 21.7m in 2014.

Meanwhile, tax payers could lose up to £10bn as a result of the proposed privatisation of the Royal Bank of Scotland (LSE: RBS.L – news) , the Telegraph reported at the weekend. The company is believed to have shrunk so much since the government paid £45.2bn to bail it out in 2008 that the Tresury is likely to suffer a shortfall of between £7-10bn.

According to the newspaper, a senior figure at RBS said: “The bank that will be privatised will be very different from the enormous international bank that the government bought. It rescued RBS to prevent a collapse of the financial system and we have made it safe. The government now wants RBS to be even smaller, and so does the Opposition. That’s OK. But it comes with a price tag.”

Former Barclays (LSE: BARC.L – news) executive Richard Davies is said to be setting up a new bank for small and medium-sized businesses (SMEs), according to Sky News on Monday. Davies, who was head of the UK operations in Barclays’ corporate bank before resigning in November, has established OakNorth.

In other company news, FTSE 250 listed Amlin (LSE: AML.L – news) has been granted permission to offer insurance products in Germany and plans to operate a branch from Hamburg, it announced this morning. As part of its move, Amlin Europe has appointed Martin Bircks as its Managing Director, who is joining the company from Zurich Insurance Group where he was Head (Other OTC: HEDYY – news) of Liability, Casualty and Legal Protection, and Head of Product Management Commercial Lines.

Electra Private Equity, the investment trust, has made its first acquisition of the year by snapping up footwear retailer Hotter Shoes. The deal, which was announced in a brief statement this morning, was valued at £85m.

The Bankers Investment Trust raised its full-year dividend by 6% to 14.13p after achieving growth in revenue for the year to October 31st 2013. The company also reported a 23.8% rise in net asset value for the 12-month period.

Luxury car retailer HR Owen (LSE: HRO.L – news) said following a strong end to the year it expects to exceed management expectations for the financial year 2013. Strong trading in the first half was followed by a robust second half performance helped by a strong used car performance.

The passing week continued the Daily timeframe correction started the week before, in an A-B-C manner, forming a bearish setup...

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